For a long time, Israel was famous for low housing prices. And not only low, but practically not growing – in the period from 1995 to our days, real estate prices in Israel have either stood still or even declined somewhat. However, this should not go on forever – consumer demand in this country is growing.

If you measure the cost of housing in the national currency – shekels – an increase of about 10%. And a considerable contribution to the prosperity of the Israeli real estate is made by our former compatriots. 
According to the Federation of Contractors and the Central Bureau of Statistics, provided to the correspondent of the online real estate magazine, by the administration of the portal, the number of new apartments sold in 2007 increased by 4.3%. If in 2006 the number of apartments was 13,291, then in 2007 there were 13,866 apartments sold. The total number of transactions in 2007 increased by 6.8% and amounted to about 93 thousand apartments.
Dr. Rina Dani, General Director of the Geographic Map Institute (under the Israeli Statistics Board), notes that despite the increase in the number of real estate transactions by 6% in 2007 compared to 2006, the number of sales of new apartments increased only slightly % and amounted to 1000 apartments for the whole of 2007. Deals were actively concluded on the secondary market, and, according to Ms. Dgani, this is due to the fact that the prices for secondary housing are 10% less than the prices for new apartments.

Features of Israeli real estate

Before we begin to review the Israeli real estate, you need to make an explanation. Two-room, and even more so, one-room apartments in Israel in our understanding are quite rare. Usually, the smallest housing is a 2.5-room apartment. A pinch-ohol is considered to be half a room – something like a dining room. She also plays the role of the hallway. 
In two-room apartments, you immediately enter the hall, here called the word “salon”. The kitchen as a separate room is also absent in most cases, and our former compatriots install partitions themselves to make a separate kitchen.
In Tel Aviv, you can meet and apartments, consisting generally of a single room – no kitchen, no corridor, no pina-ohol. But few people buy such housing. The most popular apartments, consisting of 4-5 rooms.

Eilat: you can invest in a resort

In the south, on the Red Sea, Israel owns a 12-kilometer stretch of its coastline. On this site is the southernmost settlement of Israel, the 55 thousandth resort city of Eilat. According to Israeli concepts, Eilat is very remote from other cities in the country. The nearest large city Beersheba is located 240 kilometers from Eilat. 
Eilat real estate is considered the most expensive in Israel – the Israelis compare it with our Sochi. According to data reported to us by Elena Lerner, a co-owner of the Lerner Agency, prices in Eilat per square meter are as follows:

New apartments from the developer    $ 1500 – 1800
Apartments in the secondary market    $ 1200 – 1600
Cottages     $ 1,400 – 2,200
Villas    $ 2000 – 6000
Penthouses    $ 2500 – 5000

For example, a 6-room 3-storey Eilat cottage of 220 square meters. meters worth 320 thousand dollars. The villa, consisting of seven rooms (450 sq. Meters) pulls on half a million dollars. A 4-room apartment with an area of ​​130 sq. M. meters with two toilets, one bathroom and two showers will cost $ 140 thousand. 
Investments in Eilat were considered profitable even in the period of falling real estate prices, since Eilat resorts function all year round, and there is a chronic shortage of housing for rent. Rent gives an annual profit corresponding to 6-14% of the cost of housing. And from about the second half of 2006, Eilat real estate prices began to grow.

From Tel Aviv to Netanya

For the right to be the most expensive cities in Israel, Eilat is fought by the second largest city in the country, Tel Aviv (translated from Hebrew – “hill of spring”). 
Some apartments in Tel Aviv cost three million dollars. We came across an advertisement for the sale of a one-room apartment, for which they requested $ 716 thousand. But, if in absolute prices Tel Aviv is ahead of Eilat, then at the average price per square meter it is somewhat lagging behind.
Rising prices for housing and in the capital Jerusalem. This is especially true of new buildings. Nevertheless, according to Olga Ivanova, director of the Ivanovim agency, 40% of buyers prefer new houses. However, due to rising prices in Tel Aviv, Jerusalem and Beersheba, as realtors say, apartments in small towns of Kfar Saba, Modiain, Netanya, Karkur, Beer Yaakov and Petah Tikva are in the greatest demand.

Four percent mortgage

Yes, the mortgage in comparison with ours is divine. The state mortgage system is called “scam”. As Olga Ivanova (“Ivanovim”) explained to us, it is provided for 28 years at 4.21% per annum. Mashkanta covers 80% of the cost of housing, and the remaining twenty borrower can borrow from any bank on average under 7%. Many banks do not expect this loan in dollars or shekels, but in Swiss francs. 
Mashkanta is available for both Israeli citizens and foreigners. If a person has lived in the same apartment for 15 years and did not buy additional real estate, in 15 years the state will give this person unpaid remnants of the mashkanty. But if this person suddenly still purchases another property after that, the state will demand to pay these balances.
So, for example, in the resort city of Netanya, it is proposed to take a 2-room 62-meter apartment with a shower, without a bath, but with an American kitchen on special order. The cost of this apartment – 275 thousand dollars. The monthly payment (along with all commissions to banks) will be about 5,000 shekels ($ 1,400). 
Speaking of shekels! According to Olga Ivanova, 80% of landlords and 70% of sellers prefer to take payment in shekels – the authority of the dollar is rapidly falling.

Shamay will bring down the price

By the way, very often new arrivals in Israel, without knowing the prices, can overpay for an apartment. Therefore, Olga Ivanova advises to turn to a shaman (not to be confused with a shaman) – a professional appraiser. He will not only check the legal cleanliness of the apartment, find out whether all the numerous taxes and payments to the land administration have been paid, but also for a small percentage will significantly lower the price of the apartment being sold. So, in the practice of Olga there was a case when the shamai brought down the price from the original 140 to 65 thousand dollars!

Real estate “from the hammer” cheaper by 20%

As Vladimir Sandler, director of the ACMAUT agency (Ashkelon), told us, the practice of buying so-called “bank apartments” is also common in Israel. What is a “bank apartment”? This term, which arose and settled in the Russian-speaking environment of Israel, does not exactly reflect the situation and is unfamiliar to indigenous Israelis. 
The bottom line is that an apartment, house, plot of land, or any other real estate is sold, as they say, “under the hammer” by a court decision for non-fulfillment of their debt obligations by their owners, or by division of property. The sale within the framework of the law on judicial execution is carried out by a court appointed by the court “Kones Nekhasim” (property manager), as a rule, a lawyer. Prices for such apartments can be 20-25% below market, and this is the main attractive feature of such transactions.
For example, one-bedroom (in Israel, like ours, is measured not by bedrooms, but by rooms) a banking apartment of 49 sq. M. m in Haifa, on Hermon Street for sale for $ 29,000. The price of a similar apartment on the same street, but sold by the owner, is $ 36,000.

Taxes for foreigners

The current rise in prices, most experts associate with the abolition of certain taxes previously applicable to foreigners. So, for example, a foreign investor is now exempt from paying the tax, which is called “Maschev”. As Tel Aviv lawyer Boris Bronstein explained, “Maschev,” is paid in the event of income from the sale of an apartment. 
That is, if you bought an apartment for 200 thousand shekels, and sold it for 220 thousand, then it was this 20,000 difference that was eaten before by the “mash”. The abolition of the last tax now allows a foreigner to be a real investor. And investors really became much more. If in 2005 their number from the total number of buyers was 3%, now it has reached 4.9%. True, the level of 1995, when this share was 7.5% is still far away.
Now, in accordance with the amendment to the law on taxation, which entered into force on August 13, 2007, the buyer of the first apartment in Israel is exempt from the tax on the purchase called “Mas Rehish” if his apartment costs less than 850 thousand shekels ($ 237 thousand) . And from January 29, this threshold was raised to 925 thousand shekels (259 thousand dollars).
Another factor that increased the demand was the repeal of the law prohibiting unregistered married couples from buying property in joint ownership. Previously, young people living in a civil marriage, were forced to rent housing. That is why the increase in sales prices and is accompanied by a decrease in rental rates. For example, in some areas of Tel Aviv, the cost of renting an ordinary one-room apartment has decreased by 3.5% – 5% to a level of 4,260 shekels per month ($ 1,190 or, if you will, 800 euros).

   Haifa     $ 1070
   Beersheba    $ 1390
   Tel Aviv    $ 1420
   Eilat    $ 1480


The abolition of the tax initially caused an increase in demand of 35%, but this source, according to our experts, has already dried up, and in the past two months the increase in demand has not been observed. Moreover, even a 15 percent decline is predicted for February, which will entail a certain price rollback. This is an interesting message for those who would like to invest in Israeli real estate. We can assume that we have enough such people: almost every Israeli has relatives and friends in Russia.

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